Climate-related events are impacting tourist travel decisions and hotels’ bottom lines

Climate-related events are impacting tourist travel decisions and hotels’ bottom lines

By Patricia Kirk | Nov 27, 2023 8:00am

Climate-related events are affecting where and when tourists visit U.S. destinations and will continue to play a role in vacation decisions as Climate Change worsens.  A 2021 study by the National Institutes of Health on the impact of Climate Change on tourist destination decisions, which was published in JAMA, concluded that climate, including precipitation, wind, humidity, temperatures, ecosystems and animals are essential consideration of places where  tourists choose to visit, especially when seeking a nature experience and outdoor activities.

Over the last year, US tourist destinations have been hit hard by wildfires, hurricanes, floods, heat waves, drought, and tornadoes, all of which impact hotel rates and occupancy.

Alan Reay, president of Irvine, Calif.-based, Atlas Hospitality Group, says, for example, that hotels in Page, Arizona, suffered last year due to drought when the water level at nearby Lake Powell, one of the nation’s largest reservoirs and a popular sailboat destination, dropped to 26 per cent of capacity and some portions dried up, according to Nasa’s Earth Observatory.

Reay, whose research and advisory firm focuses on the California’s hospitality firm, cites as examples, the recent wildfires in Maui that emptied the island’s hotels of tourists and are now sheltering local residents burned out of their homes, as well as the evacuation of tourists from Catalina Island, a popular tourist destination, when Tropical Storm Hilary swept across Southern California in August.

Reay notes that climate-related events also are making it harder for hotel owners and developers to access financing and insurance, noting that an insurer exits California every month. He says that insurers are not only leaving at-risk states, like California and Florida, the less competitive environment and increased risks are driving up rates for those that stay.

Wildfire catastrophe

A total of 38,831 wildfires swept across North America so far this year, burning 1.96 million acres, as of August 28. But the Maui fires were the most disastrous in U.S. history in more than 100 years in terms of lives lost, with 115 confirmed dead and more than 1,000 people still missing.

Maui fires also are taking a toll economically. Prior to the fires about 8,000 people day visit Maui, now that number has dropped to 2,000 per day.  At first officials advised tourists to stay away, but that message has changed, according to a CBS News report. Hawaii Governor Josh Green says that without tourists at Maui hotels and restaurants, the island’s economy will collapse. Since 85 percent of the historic town of Lahaina burned, for example, its hotels, restaurants, and stores continue to lose $9 million per day. 

Daniel Fenton, executive vice president and director of the Global Tourism Practice at JLL, says that the perception of a poor experience or high safety risk does affect tourism in places with a history of life-threatening events, especially when a recent occurrence like a wildfire or hurricane is top of mind. He says, however, that extreme heat is less likely to cause families to change their vacation plans but notes that cause people to delay travel plans until fall, when the location cools down 

Fenton also notes that heat waves are a silver lining for hotels in destinations with more temperate summer climes and historically softer demand, like the U.S. Northeast. He notes, however, hotels located in areas affected by heat waves are taking steps to help ensure a satisfying guest experience, like utilizing ballrooms and conference facilities to provide more family-oriented, indoor activities during the hottest time of day or recommending nearby, indoor recreational facilities and attractions.

When weather forecasters call for unpleasant or uncomfortable weather, some hotels and resorts are taking a proactive approach, contacting upcoming guests and offering to reschedule their reservations to a later date, rather than come and have a miserable time. Fenton contends that this kind of flexibility and customer service is what keeps guests returning in the future.

Hurricane season

National Oceanic and Atmospheric Administration Sientists are projecting an “above-normal level of activity” in their annual Atlantic hurricanes and tropical storm forecast, up to 21 events this year due to unusually warm ocean waters in areas where hurricanes form. Waters off the  Florida Keys, for instance, warmed to 101.1 degrees Fahrenheit (38.3 degrees Celsius)  in July.

Hurricane Ian made landfall near Cayo Costa, Florida, last September as a Category 5 storm with wind speeds of 160 mph and a storm surge of 15 feet, doing extensive damage to Fort Myers Beach, Sanibel Island, other Southwest Florida beach communities and parts of the Carolinas and Virginia .Just last week, Hurricane Idalia, a category 4 storm with winds of 125mph and a 10-foot storm surge, slammed into the Central Florida Gulf Coast, making landfall at Horseshoe Beach and destroying homes and businesses, then brought heavy rains and flash flooding to Georgia and the Carolinas before moving out to sea.

Tropical Storm Hilary, which made landfall in Northern Baja, Mex., in late August, brought high winds, torrential rainfall, flash flooding, and mudslides and rockslides across Southern California, before moving on to Arizona, Nevada and Utah. This event was followed by an unusual late-summer storm last week in Black Rock Canyon, stranding thousands of artists and art lovers in knee-deep mud at Burning Man , an annual, weeklong art and counterculture fest in the Nevada desert, without toilets and limited food, water and other supplies. 

Prolonged heavy rainstorms also brought life-threating flash flooding across the New England states in July, including upstate New York, Connecticut, Rhode Island, Massachusetts, Vermont, New Hampshire, and Maine, causing flash flooding and significant damage to homes and businesses estimated at more than $5 billion. Vermont was hit hardest.

Vermont is a popular tourist destination in summer and fall, with tourist spending adding $3 billion annually to the state’s economy. This year, rainstorms dumped 3- 9 inches of rain across the state within 48 hours, resulting in widespread and significant property damages from catastrophic flash floods and overflowing rivers.  The storm resulted in extensive flooding of communities, washouts of numerous roads and bridges, and landslides and mudslides. 

The Great Flood of 2023, as its now called, is expected to impact fall foliage tourism across New England, which attracts millions of visitors, who spend about $8 billion annually, according to the U.S. Forest Service, to leaf-peep nature’s colorful displays.    

A former meteorologist at New Hampshire’s Mount Washington Observatory, Jim Salge predicted in a blog on that the region’s  fall colors will not be as bright as in years past and a patchwork of colors will develop early, especially with Swamp Maples, due to a combination of the heavy rains in July and ensuing humidity, last year’s drought, and Arctic air in February that pushed temperatures to record lows that was followed by a cold bast and deep freeze in May that damaged trees

Meanwhile, the Southeast and Southwest suffered from a month-long heat wave in July that affected tourism from Arizona to Florida, including popular summer tourist destinations.  Disney World, Universal Studios, and Seaworld in Orlando, for example, all reported lower than average seasonal visitor traffic, reported CNN.  Despite discounts and other incentives, the slump in Central Florida tourism is attributed to a combination of the heat wave, waning of the post-pandemic travel boom, and the state’s tense political climate. 

Tourism impact

Cities track tourism performance using hotel bookings and restaurant revenue. Data from STR appears to confirm the heat wave’s impact on tourism and hotels, as hotel markets with the poorest performance in July and August where primarily in hot zones, including New Orleans, Phoenix, and Miami, while the best hotel performance was in locations with a temperate climate, including Nashville, St. Louis, San Diego, Los Angeles and New York City. 

Going forward Climate Change is expected redistribute tourism resources, spatially and temporally, according to thermal comfort, attraction of landscape, and availability of conditions for activities, such as skiing, noted a 2019 Environmental Research Letter from scientists at the University of Maryland, who looked at the geographically diverse effects of Climate Change on hotel profit rates.

Analyzing data from the monthly financial records of more than 1,700 hotels nationally, from 2016-2018, the researchers showed that a deviation from 18 to 20 degrees Celsius average monthly temperature leads to a decrease hotel profits, resulting from fewer guests, less revenue, and the higher cost per occupied room partially due to an increased energy and water usage.

These scientists predict that Climate Change and GHG emission scenarios In the future will lead to a loss of profit in most hot climate zones, particularly the Southern regions, which produce higher GHG emissions that will lead to a more serious effect on hotel finances.

Los Angeles-based Anthony Sanchez, design director and principal at Nadel Architecture + Planning, notes that with the push for ESG, and Climate Change being top-of-mind for virtually everyone, sustainability is one of hotel developers’ key concerns. “Many stakeholders are shifting their hotels’ back-up power from diesel to battery, as a more sustainable approach, and water collection and re-use are becoming commonplace conservation measures for hoteliers.” h says.. “While some of these changes are driven by regional code requirements, a growing number of developers and architects are motivated by genuine concern and care for the future of our planet.”

Sanchez stresses that responsible hospitality design is intrinsically connected to the hotel’s environment, with each hotel designed to seamlessly integrate into its surroundings. For example, hospitality developments in desert climates benefit from site location and advance planning to avoid flood zones, and topography is considered to enable water collection and retention — a sustainable approach to mitigating flash flooding and meet the on-site water needs of large hotel developments.

Hotels also are being designed to decrease the impact of weather-related emergencies on hospitality properties located in areas with a history of adverse climate events.

In the case of hurricane- or tornado-prone areas, Sanchez says that implementing lower roof pitches, minimizing overhangs, adding shutters to windows and openings, reinforcing connections to the foundation, and constructing amenity areas that double as communal shelter-in-place areas are simple solutions that protect hotels and provide increased safety measures for everyone on the property.

For hotels situated in fire zones, using non-combustible building materials, employing fire-resistant landscape maintenance principles, and adding defensive plantings in strategic locations on the property are smart, fire-safe options that align with a hotel’s aesthetics.

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